Does a company separated from its parent beat comparable companies over the following year?
Study 30 · Inconclusive · recorded 1 October 2026 · answer: Not settled · full paper with figures
Correction, 2 October 2026. The text of this record was rewritten to the project's editorial standard, from the study's plan, result and records rather than its earlier wording. What the study found is unchanged.
The question
Studies in the finance literature report that such newly independent companies tend to do better than comparable companies. We compare each one's return over the 252 trading sessions after its first price with the average return of five companies in the same industry group and nearest in trading size.
Rules fixed before the result
Before any price was read, we fixed the events, the rule for choosing five comparables per company, the one-year window and the bar: the median gap counts only if it falls outside the middle 95% of 20,000 random draws swapping each company with one of its comparables. At least 40 events from 40 unrelated companies were required, and the test had to raise a false alarm on 2% to 9% of 400 samples of ordinary companies with no such event.
Data and method
The outcome is each new company's holding return over the 252 sessions from its first price, minus the mean return of five comparables in the same industry group nearest to it in trading value. If a new company or a comparable leaves the record, its return stops at its last price and counts as unchanged after that. The measure is the median of that gap across companies; parent companies were measured the same way as a second reading.
The answer
Inconclusive: across 62 new companies, the median difference from their comparables' average was minus 11.6 percentage points, inside the no-effect range of minus 15.8 to plus 7.8 points that 95% of random swaps of each company with its own comparables produce, so the gap could not be told apart from what random swaps produce. The parents also fell inside their range. This is what we expected, and none of the nine alternative measures could be told apart from random swaps either.
Main estimate
-0.116 fraction (95% range -0.158 to 0.078), from 62 observations
What it changes
No rule changed. The median gap from comparable companies could not be told apart from what random swaps with comparables produce at this sample size, though a real gap too small for this sample to detect is not ruled out. No follow-up study of these companies will be planned from this data.
What remains uncertain
The record cannot tell a clean separation of a whole business from other events it labels the same way, and its date is the vendor's record that the company was spun off on that date; no announcement date is inferred. Size is matched on trading value, not market value. With 62 events the no-effect range is wide; we expected it to exceed the advantage the literature reports once events that are not clean separations are mixed in.
How it was made
Run took 31 minutes; independent code review: approve; the recorded calculation reruns to the same result.
Fingerprints
plan 8b9f2cf959bc39fc9ddba7ec15759f60f1bfddcd7f879f1ac99f790fa210785e result a326181301dfa0cd6c1e52970e3697b3fcf1e03b6950fcb564d9154d48a8e615
Exploratory work on development data; not a performance claim.